Ambuja Cements Q1 Results: Revenue Beats Estimates, Ebitda Up 38%

Ambuja Cements Ltd.'s first-quarter revenue rose 18.3% to beat analysts' estimates.

The Adani Group-owned cement manufacturer's net profit beat Bloomberg consensus estimates though it fell 38% year-on-year to Rs 644.88 crore in the quarter ended June, according to an exchange filing. Bloomberg consensus estimates stood at Rs 494.53 crore of analysts tracked by the agency.

The decline in profit was on account of a significant drop in other income to Rs 189.47 crore compared with Rs 630.93 crore in the previous year. The high numbers in Q1 FY23 were due to a one-off dividend of Rs 545.11 crore received from its subsidiary, ACC Ltd.

Ambuja Cements Q1 FY24 Highlights (Standalone, YoY)

• Revenue up 18.29% at Rs 4,729.7 crore. (Bloomberg estimate: Rs 4,234.14 crore)

• Ebitda up 38.17% at Rs 948.55 crore. (Bloomberg estimate: Rs 828.45 crore)

• Ebitda Margin at 20.06% vs 17.17% (Bloomberg estimate: 19.6%).

• Net Profit down 38.51% at Rs 644.88 crore. (Bloomberg estimate: Rs 494.53 crore)

The 18% revenue growth was driven by volume growth of 22.9% year-on-year at 9.1 million tonne and an increase in the share of blended cement. The company's flagship subsidiary, ACC Ltd., reported industry-leading volume growth of 23.2% year-on-year to 9.4 million tonne.

Total cost per tonne fell by 7.1% year-on-year to Rs 4,575 per tonne, driven by a 17% reduction in kiln fuel cost to Rs. 2.07 per thousand kilocalories. Cost reductions drove the 290 basis point expansion in margins.

A waste heat recovery system of 18 MW at Bhatapara, Suli, and Rauri has been commissioned in the current quarter. The company is planning to increase the WHRS capacity to 121 MW by this year's end, with an additional 33 MW planned at Suli, Ametha, and Maratha. WHRS aids in reducing fuel consumption, carbon emissions, and operating costs in a plant.

The company has also placed orders to expand clinker capacity by 8 million tonne at its units in Bhatapara in Chhattisgarh and Maratha in Maharashtra, which will enable the production of 14 million tonne of blended green cement, the filing said. The expansion is part of Ambuja Cements' strategy to double production capacity over the next five years from the current capacity of 67.5 MT.

"Along with the strong demand for our premium cement products, growth was fueled by our various competences in operational excellence, supply chain management, and sales and marketing excellence," Chief Executive Officer Ajay Kapur said in the filing.

Shares of Ambuja Cements were trading 0.62% lower at Rs 458.7 apiece after the results were announced, compared to a 0.5% decline in the benchmark NSE Nifty 50 as of 9:58 a.m.

Disclaimer: AMG Media Networks Ltd., a subsidiary of Adani Enterprises Ltd., holds a 49% stake in Quintillion Business Media Ltd., the owner of BQ Prime.